Soros says worst of global crisis is behind us

By IBT Staff Reporter On 06/21/09 AT 1:08 PM

The worst of the global economic crisis is over, multi-billionaire financier George Soros told Polish news channel TVN24 on Sunday urging the creation of international regulations to oversee global markets.

Decidedly the worst (of the crisis) is already behind us, said Soros, a 78-year-old Hungarian-born American with Jewish roots.

He did not elaborate but went on to stress the uniqueness of the current economic turmoil.

This is not like previous crises but marks the end of an era. The system to date had been based on the false assumption that markets can independently regain their equilibrium and that the system is self-correcting, he explained.

He also said the regulation in the economy should be aimed at controlling market bubbles.

We need international regulations to retain international markets. This won't be easy...If we won't be able to do this... than globalization, as we now know it, will fall apart, he said.

To deal with the current crisis he said the state must step in, give guarantees to financial institutions and increase government spending, adding that he supported anti-crisis measures undertaken by the U.S. administration.

Since that could create a risk of hyperinflation he said the state must diminish its role once the credit system is restored.

Soros also said Poland would have been less affected by the crisis if it had been in the euro zone.

Poland, Hungary and other countries were not protected because they were outside the euro system, so when Lehmann Brothers collapsed, banks began withdrawing their assets from those countries, he said.

The center-right government of Prime Minister Donald Tusk made 2012 euro adoption one of its priorities but last week a senior ruling party official signaled that because of the economic slowdown the plan would need to be postponed.